I’m mind boggled about Google.
Records at the city of Austin’s development services website show that Google is paying an astonishing $668 per square foot for tenant improvements on its last-to-occupy floors — levels 21, 22 and 23 at 500 West 2nd.
The plan review filed last December and finally approved June 11 could be off; the city doesn’t verify valuations. It’s up to the tenants and contractors to fill out those forms, and mistakes happen. But here’s what document 2017-156597 PR indicates — tenant finish out for 37,892 square feet of kitchen, dining and offices is valued at $25,295,403. Yep, that factors out to more than $600 per square foot.
It’s possible Google spent that amount for the entire 300,000 square feet it leased 500 West 2nd. Still, I have isolated a few areas that shed light on the internet Goliath’s big budget.
The penthouse, for instance on floor 29, will cost about $7.3 million, according to data at the Texas Department of Licensing and Registration. That pencils out to about $200 per square foot — a pricey number in itself, given that $120 is an average cost per square foot for premium tenant improvements in new downtown Austin buildings, according to several independent sources.
JLL’s “2018 Office Fit-Out Guide” pegs even the most expensive tenant improvements underway in Austin at $192.57 per square foot.
While fiddling and cross-checking Google’s projects on the city of Austin’s website, as well as TDLR, I discovered something intriguing and very recent.
Documents filed last week — July 31 — at the Texas Department of Licensing and Registration show Google is planning $2,630,000 in renovations for phase 1 of Google 100 Congress, Suite 500. On Aug. 1 — just a day later — Google filed plan review documents at the city for the same space. The process is pending and the filing sheds no light on the size of the space nor does it confirm TDLR’s valuation number.
CBRE, which handles leasing for 100 Congress, could not comment on any potential Google deal there. Aquila Commercial in its latest second quarter 2018 office report shows the fifth floor at 100 Congress available — 20,272 square feet. Obviously the ink is still damp on this deal.
While Google has been consolidating offices across the city into downtown it isn’t abandoning real estate in tech heavy northwest Austin where Apple Inc. has a large campus.
TDLR records show that Google is remodeling 45,000 square feet at 7700 W. Parmer Lane for about $3,000,000. That looks to be a very modest $66.66 per square foot.
Meanwhile the other internet powerhouse in town, Facebook, is gearing up for its new offices at Third+Shoal, the office tower under construction around the block from 500 West 2nd. The formal address is 601 W. Third St.
Dozens of documents are on file at the city, but the easiest way to decipher tenant improvement costs is via Facebook’s filing with TDLR. According to that data, the social media company is spending $17,456,333 for interior construction for levels 15, 16, 17, 19, 21 and partial space on level 14. This is roughly 130,000 square feet — just a portion of the 350,000 square feet the company ultimately will occupy.
Do the math and Facebook is spending a relatively modest $134.28 per square foot for tenant improvements.
Facebook has already spent millions in downtown Austin at 300 W. Sixth Street, where it built a massive multifloor interior staircase within an existing traditional office building. I wrote about that interior investment while reporting for the Austin Business Journal.
Facebook spent at least $12 million to upgrade those offices from previous tenants, and it’s not clear whether the company will maintain that space when it occupies Third+Shoal in summer or fall 2019.
The dozens of files Facebook vendors have filed with the city are nothing short of riveting. RAS Design Group, a kitchen remodeling company in Martinez, California, filed a 1,966-page report just about Facebook’s kitchen design and equipment in the new building.
There’s a report entitled, “Rational Analysis for the Smoke Control System,” drawings showing the sightlines in an auditorium, stair pressurization reports that compute force on the stairwells depending on temperature and wind speed, and detailed drawings of specialty sliding doors. It’s a library of reading material you’d never imagine existed.
At this level of detail, it’s a given that Google and Facebook are keeping consultants and contractors very busy — flush with cash flow, too.
Here are some details of who is getting in on the action:
CTA Architects & Engineers — a company with a decidedly under-the-radar presence in Austin — is handling all of Google’s projects. DPR Construction is the general contractor for Google’s downtown projects, and Balfour Beatty has the building assignment on Parmer Lane.
WRNS Studio in San Francisco is Facebook’s architect of record at Third+Shoal. Harvey-Cleary Builders is Facebook’s general contractor.